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Determinants of Sustainable Competitive Advantage from Resource-Based

View: Implications for Hotel Industry

Article  in  Journal of Hospitality and Tourism Insights · January 2021

DOI: 10.1108/JHTI-08-2020-0152

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Determinants of sustainable Determinants

of SCA from
competitive advantage from resource-based
view
resource-based view: implications
for hotel industry
Md Sazzad Hossain Received 25 August 2020
Revised 19 October 2020
Centre for Research and Innovation in Tourism, 12 December 2020
School of Hospitality, Tourism, and Events, Taylor’s University, Accepted 12 December 2020
Subang Jaya, Malaysia
Kashif Hussain
Centre for Research and Innovation in Tourism,
Faculty of Social Sciences and Leisure Management, Taylor’s University,
Subang Jaya, Malaysia, and
Suresh Kannan and Sree Kala Kunju Raman Nair
Centre for Research and Innovation in Tourism,
School of Hospitality, Tourism, and Events, Taylor’s University,
Subang Jaya, Malaysia

Abstract
Purpose – This study examines the relationship between absorptive capacity, team culture, competitive
intelligence awareness and entrepreneurial behavior with strategic flexibility and sustainable competitive
advantage and further investigates the moderating influence of innovativeness on the relationship between
strategic flexibility and sustainable competitive advantage in the hotel industry.
Design/methodology/approach – The current study applied a quantitative research method to collect data
from five-star and luxury hotel management staff in Malaysia, using questionnaire surveys. A total of 550
questionnaires were distributed, and the researcher received 457 valid questionnaires. The hypotheses were
tested using the SEM (structural equation modeling) analytical technique.
Findings – The salient findings of this research are (1) absorptive capacity, team culture and competitive
intelligence awareness have a significant impact on strategic flexibility and sustainable competitive advantage, (2)
entrepreneurial behavior has an insignificant effect on strategic flexibility and sustainable competitive advantage,
(3) strategic flexibility has a significant impact on sustainable competitive advantage, (4) innovativeness actively
moderates on the relationship between strategic flexibility and sustainable competitive advantage.
Research limitations/implications – The study described here introduces a sustainable competitive
advantage as a new and dynamic approach to explore how its outcomes or performance can be enhanced in the
hotel industry. The outcomes of sustainable competitive advantage can help the long-term survival of hotels.
Originality/value – The present study suggests and explains the role of sustainable competitive advantage
in the hotel industry and offers new insights into the competitive hotel industry’s gaps and weaknesses.
Keywords Strategic flexibility, Innovativeness, Sustainable competitive advantage, Hotel industry
Paper type Research paper

Introduction
The hotel business environment is categorized by increasing complexity, to create a sustainable
competitive advantage (SCA) that lie in what it knows, not what it owns. Nowadays, hotel
businesses within the competitive market are facing several challenges. Hence, why certain
hotels succeed in a competitive environment while the rest fail? The answer might be simple and Journal of Hospitality and Tourism
Insights
straightforward, but it is not easy. Hotel businesses need to know on how to build resilient © Emerald Publishing Limited
2514-9792
strategies that can secure an SCA within their competitive market. According to Kuncoro and DOI 10.1108/JHTI-08-2020-0152
JHTI Suriani (2018), SCA is based on resources and capabilities that are being valuable, rare,
imperfectly imitable and not substitutable. Earlier, Barney et al. (2001) suggested that SCA as a
powerful resource-based strategy for the competitive market. A hotel achieves SCA through
rare and costly to imitate capabilities such as unique context or unique tools, close relations
with vendors, customers and staff (Bhakar et al., 2016), to help meet customer
demands. The competitiveness strategy is also an integrated program that offers rivals a
competitive advantage. In order to promote the quest for new combinations of resources, skills
and processes, the Le Roy et al. (2018) identified SCA as providing access to scarce and
additional resources. Innovative organizations embody the hotel’s essential openness to break
with existing processes (Dotzel and Shankar, 2019). This tendency is idea generation,
experimentation and creativity so that new products/services and technologies are developed
(Zhang et al., 2020). Therefore, the current study examines SCA deeply and investigates the
moderating influence of innovativeness for the hotel industry. In competitive markets and the
advancement oftechnological innovativeness, weprovide an essential empiricaltestthat mustbe
involved in management studies.
Furthermore, strategic flexibility has recently gained the interest of academics and
professionals as an important method to tackling future uncertainty. It allows the best action to
be taken within its available options and has been regarded as an adequate practical approach in
managing future uncertainty (Bamel and Bamel, 2018). Although hoteliers are highly unstable, a
flexible structure strategy must react rapidly to a change in its circumstances (Yang et al., 2015).
The current research highlights this delay in exercising flexibility that has not received
considerable attention from decision-makers and researchers. The extent of flexibility can be
measured in several different ways. For example, the overall cost to change an organization’s
capacity, the extent of possible choices available, and the state in which a flexible system is
efficient are suggested measures of flexibility.
Moreover, teams within an organization are collecting individuals for specific purposes of the
goals necessary to gain. Team culture represents the organizing and practicing lifestyle during
the service and operation. It is very much needed for the hotel business to succeed in the future
within a competitive market. It indicates the support and coordination among the activities
during the operation and concern organizational success in a competitive environment. Recently,
researchers and practitioners have been very interested in transitioning from individual to team-
based work (Kozlowski and Bell, 2019). According to Ashauer and Macan (2013), it is vital to
promote effectiveness and respond to technological achievements and sustainable development
challenges. To achieve SCA for hotel operators, they must be willing to invest and act responsible
and sustainable using the team as a resource (Lozano-Oyola et al., 2012).
Additionally, competitive intelligence awareness (CIA) is a combination of economics,
communications, military planning, computer science and strategic management disciplines
(Bartes, 2015). It defines as a systematic, ethical effort to collect, target, synthesize competition
and external environment to produce actionable insights for decision-makers (Mu~ noz-
Ca~navate and Alves-Albero, 2017). While the pace of rapid market growth is relatively new to
handle, it is growing in complexity and value (Nenzhelele and Pellissier, 2014). It indicates the
awareness of competitive uncertainty and predictive practice of the hotel business. Little
studies have considered that the CIA in the strategic management area links a unique thought
for the hotel industry competitiveness.
Additionally, entrepreneurial behavior is a preference for innovation and a change in the
existing organization and the status quo. The assumption of entrepreneurial behavior
guides scholars’ work and focuses on the aspect of organization creation. First, the process
of creating behavior in the progression of the business is an individual or organizational-
level phenomenon. It is an essential element of the organization’s formation. Without the
individuals’ creation and activities, environmental, economic, social and political are not
created by the organizational context (Monge and Poole, 2008). Second, it indicates
the individual’s engagement in entrepreneurial activities that occur in a period. It also Determinants
recognizes the activity that requires a set of actions or series of actions. Third, the principal of SCA from
element of entrepreneurial behavior in an organization from the responsibility to protect
from uncertainty. Less attention created in the past studies from the behavioral perspective
resource-based
(i.e. creative activities, responsible approach). Furthermore, despite the considerable growth view
of absorptive capacity, specific critical gaps remain and most studies did not consider new
external knowledge (Liu et al., 2013). It is fundamentally used in management research to
absorb external knowledge with the view to implement in the internal process of learning. It
refers to new external knowledge that explains assimilation, acquisition, transformation and
application.
Therefore, this paper’s aim is twofold, a theoretical point of view, the study identified the
influencing factors of SCA and assessed the mediation role of strategic flexibility. This
focuses on the critical factors influencing rivals to collaborate as well as on their relative
strength. This research focuses more explicitly on SCA with various strategic conducts
within the hotel industry. Additionally, the hotel industry appears to be characterized by
competitive dynamics. For this reason, this study conducted an empirical analysis in the five-
star and luxury hotels to analyze strategic behaviors on intrinsic aspects of competition.
Besides, the problems identified based on the industry-specific, whether the hotel sector
required the SCA program in the current competitive market. We considered few case studies
of international chain hotels that required SCA implementation (i.e. Shangri-La recently
explains the highly competitive evolving market; numerous hoteliers are still facing several
challenges related to SCA). Both theoretical and empirical perspectives help policymakers
better understand and manage hotels operating in a resources-based competitive
environment. Finally, little attention has been drawn in the past studies about SCA based
on resources and capabilities with the influencing factors of strategic flexibility that attempt
to link a new relationship among variables. Therefore, the current study efforts to analyze
this question, to what extent influencing factors of strategic flexibility enhances SCA? The
underlying belief in this issue is that every business today has untapped skills and capital,
represent a vast potential for gaining SCA.

SCA in the hotel industry

In a competitive market, hotel businesses are looking for new ways of achieving competitive
advantages. The idea of competition to be resisted when it comes to organizations’ sources of
profits has historically been discussed by most approaches in strategic management (Arbelo
et al., 2020). SCA is the framework that makes full use of the existing business opportunities
for organizations capital while exploiting other resources to guarantee the sustainability and
replicability of its competitive position for the future (Zawawi and Abd Wahab, 2019).
Specific approaches such as creativity, process improvement, superior quality, lower cost, or
better value are often implemented with SCA performance in the firm. Early, Barney (1991)
believes that substantial resources are a source of SCA and suggests that any organization
that wants to acquire SCA has acquired them.
The way of achieving and sustaining their competitive advantages is one of the main
issues in the hotel sector (Singjai et al., 2018). In order to achieve SCA in hotels, it is necessary
to understand the services behavior and the characteristics of the hotel. This study elaborates
on a model that explains how SCA can be obtained from a service management perspective in
hotels drawing on its literature. One of the most critical sectors for checking the hotels that
have already been found for several reasons is the hospitality sector. The first is that,
although hotels are not direct competitors, increased complementarity between programs
and the frequent need for special interests to collaborate. Second, the analysis is much more
challenging in several hotels than the typical strategic network plans in which a focal firm
JHTI exists in most cases. In order to ensure a quality offer that could compete effectively at the
international level, the global hospitality paradigm also demands greater cooperation and
collaboration, both local and regional (Chim-Miki and Batista-Canino, 2017). To analyze this,
the study focused on five-star and luxury hotels in Malaysia. This country is one of the most
attractive destinations in Southern Asia. This study includes the most popular tourist
regions, namely Kuala Lumpur, Penang and Malacca. The main attraction to tourists for
these places is cultural resources and diversity, natural beauty and landscape, food and
gastronomy and more critical is five-star and luxury hotels.

Underpinned theory: recourse-based view

The present study followed resource-based view (RBV) as a supporting theory of the
proposed model. In strategic management research, RBV has emerged as a popular theory of
organizational competitive advantage. In the beginning, Wernerfelt (1984) investigated how
the resource was possessed, deployed and used by the organization. This theory was later
cited by Porter and Millar (1985), who reviewed the organization as a bundle of assets or
resources tied semi-permanently in a firm.
RBV has become a popular theory for competitive advantages in strategic management
research (Furrer et al., 2008). The firm as a collective of assets or resources semi-permanently
bound up in the hotel industry, then quote this theory. During the interim, Bromiley and Rau
(2016) developed core competencies based on the essential category of an organization’s capital
and capacity. Lin and Wu (2014) also argued that the organization’s finances are the primary
source of competitive sustainability. The resource-based vision principle is a strategic element
with the use of assets and expertise to be an advantage for competition.
This view also synchronized well with core competencies, strategic asset, distinctive
competencies, which provides a potential sustained competitive advantage edge of an
organization (La Rocca et al., 2018). The earlier statement’s strategic asset describes the set of
competitive advantages that are challenging for the competitors to trade and imitate, are
scare, appropriable and specialized resources and capability that bestow the hotel’s SCA.
This established theory has aided to reinforce the relationships of the research framework
and constructs in establishing theoretical support.

Literature review and hypotheses development

Absorptive capacity
The absorptive capacity is characterized as identifying the importance of new outside
information by an organization (Rafique et al., 2018). The wide ranges of skills required to
deal with the tacit component of transferred knowledge and the need to modify these
imports. It is, therefore, including the acquisition and assimilation aspects of information on
the organization’s strategic flexibility. Apriliyanti and Alon (2017) suggested that these two
components play complementary roles separately. It is esteemed that without acquiring it,
an organization can not apply external knowledge. In the previous literature, few studies of
future absorption and strategic flexibility examined to the full understanding of the
researcher (Lin et al., 2020). It examines the connection between improved flexibility and an
aggressive marketing strategy and how knowledge absorption reflects this relationship.
The external expertise to be used in the hotel’s internal strategic phase, which provides an
overall competitive advantage (Liao et al., 2017). The relationship between absorption capacity
and the competitive advantage was seen by Chaudhary and Batra (2018). The term of the RBV
can be called strategic flexibility by gaining and using outside know-how to gain a continuing
competitive advantage. A substantial contribution of this research is the mediation role of
strategic flexibility between absorptive capacity and SCA. A recent study Kale et al. (2019) has
postulated the impact of absorptive capacity in the hotel sector in identifying performance. Determinants
They investigated the necessity of acquiring and managing knowledge that has been of SCA from
emphasized to increase the firm’s overall performance and create SCA. From the above
arguments, the above arguments formulated the hypotheses as follows:
resource-based
view
H1a. Absorptive capacity has a positive effect on strategic flexibility.
H1b. Absorptive capacity has a positive effect on SCA through strategic flexibility.

Team culture
The emerging team culture or team engagement offers a shared, group-specific sense of
identity. The existing characteristics or new patterns of team interactions can lead to an
influential hotel team culture as it provides self-assessment and interaction (Jamshed and
Majeed, 2019). One or more individuals to perform resulting indiscernible and potentially
measurable groups products and operate within the organizational context. Simply team is the
collection of individuals for a specific purpose and help to make the long-run organizational
decision (Lehmann-Willenbrock, 2017). The study by Ahmed (2017) has assumed that a small
number of members with complementary skills and committed to a set of performance goals
with strategic flexibility. The group has reached a new plateau of productivity, which enhances
the organizational strategic flexibility by following their intrinsic works.
Besides, team culture is mutual communication in inter-organizational procedures by
sharing tasks and knowledge. According to Luvison and Marks (2013), it involves sharing
responsibilities or mutual mental understanding among team members. It has two principal
components, such as a standard/consistent model of the situation among the team members
and the mutual mental model of the inside/outside team members functions (Butchibabu et al.,
2016). Though, team culture also enhances SCA through strategic flexibility. The team-oriented
organization, employees, together amplify knowledge, skills and abilities and increased
productivity of the hotel (Delmas and Pekovic, 2018). It is noted that the SCA of a hotel is not an
individual task to achieve, but the group or team can predict it by their flexible strategies.
Recently, Han et al. (2016) have revealed that how workplace fun promotes team performance in
the hotel business. Little is known about the relationship mechanism in direct and indirect that
attempts to address a new link in the past literature.
H2a. Team culture has a positive impact on strategic flexibility.
H2b. Team culture has a positive impact on SCA through strategic flexibility.

Competitive intelligence awareness

According to Guarda et al. (2012), the competitive advantage can be understood to look for
unique opportunities to improve the market role of the firm. As such, both public and private
entities develop their creative information systems to train and plan management for
improvements to the hotel’s external environment (Shujahat et al., 2017). In the field of strategic
management, competitive intelligence plays a significant role in organizational knowledge and
practical experience (Placer-Maruri et al., 2016). Seyyed-Amiri et al. (2017) pointed out that
adequate information should be provided to organizations in order to use competitive
intelligence optimally. Nzewi et al. (2016) has considered data, information and knowledge
gathering are an on-going process of engaging to facilitate the decision process to improve the
competitiveness of an organization. Thus, the CIA of the organization following competitive
criteria can enhance strategic flexibility over the using strategies. The CIA also effects SCA
through strategic flexibility. The mediating role of strategic flexibility denotes the playing
intensity or awareness in following flexible strategies to gain SCA. According to Tuan (2016), it
explained ambidexterity and agility in the service industry. It also investigated to predict
JHTI competitive advantage in an intense effect with the business for sales-people. When the CIA is
high, then the strategic flexibility strongly effects on SCA, if low or then it becomes weak in the
effect. In a recent study, K€oseoglu et al. (2016) examined the competitive and competitor
intelligence practice in the hotel industry.
H3a. CIA has a positive impact on strategic flexibility.
H3b. CIA has a positive impact on SCA through strategic flexibility.

Entrepreneurial behavior
Many service organizations have shifted their focus to firm-level behavior to explore business
performance. Firm-level behavior provides a clearer insight into the entrepreneurial process.
Thus, entrepreneurial behavior refers to the strategy-making process that provides an
organization based on actions and involves the outcome of management-related preference,
behavior as expressed by firm-level managers or top-level employees (Wales et al., 2020).
Several studies assumed that entrepreneurial behavior is a higher level of entrepreneurial
behavior as various dimensions as innovation, proactiveness and risk-taking (Afsar et al., 2017;
Audretsch and Link, 2019). In line with innovation as it considered as an establishment’s
willingness to create ideas and view concepts in process, and strategic flexibility enhancement.
The proposed relationships indicate the researcher and practitioners emphasize on this topic
to increase the hotel performance. Employee entrepreneurial behavior denotes the creative
ideas of the employee in a critical situation (Gruber and MacMillan, 2017). Also, its effect on SCA
through strategic flexibility. The mediating role of strategic flexibility, which acts as an
essential role in making it flexible for making a perfect decision based on the situation (Brozovic,
2018). In the literature, there is a limited number of studies examining the mediating role of
strategic flexibility. It signifies that the individual level of entrepreneurial behavior can enhance
the decision to use it in perfect scope. Therefore, an establishment with higher strategic
flexibility tends to create a new opportunity to conduct its SCA. Hernandez-Perlines (2016) has
investigated the entrepreneurial orientation to determine the hotel performance.
H4a. Entrepreneurial behavior has a positive effect on strategic flexibility.
H4b. Entrepreneurial behavior has a positive effect on SCA through strategic flexibility.

Innovativeness
In recent years, increasing competition and changing technology, people desire to follow
innovation, invention, creativity and new ideas. Several studies investigated the significance of
innovativeness for surviving firm’s life of doing the operation (Hollebeek and Rather, 2019; Chen,
2019). Innovativeness can be defined as ’the extent to which an individual adopts innovation
relatively earlier than others, where “relevantly earlier” means the real, not perceived, time of
adoption. It gives the way of attaining a competitive advantage by extending and enhancing
overall performance, retaining existing ones, reinforcing ties with the distribution networking
by earning profit with the technical workplace (Hyytinen et al., 2015). Also, an organization has
been emphasized in studies where the complementary effect of the market on product/service
innovativeness is considered (e.g. Rodriguez and Wiengarten, 2017). For example, Chen et al.
(2017) indicated strategic flexibility interacts with the market and SCA to raise innovation levels
in an organization, resulting in market-driving behavior. According to Hossain et al. (2019),
the service operation and technological innovativeness are organized by the changing
organizational environment. The past studies support work, with innovativeness acting as
positive moderators (Brockman et al., 2012). The importance of innovativeness in service firms is
becoming recognized. Indeed, hotels structurally better equipped for high innovativeness due to
decreased departmentalization and less advanced control (de Carvalho et al., 2020).
 H5. Innovativeness moderates between strategic flexibility and SCA. Determinants
of SCA from
Strategic flexibility and SCA resource-based
Several strategic flexibility studies have been carried out on findings of the organizational view
change introduced, such as the transformation from sector to market (Harrigan, 2017). The
nature and adaptability of hotel resources and the allocation of management attention are a
vital factor for flexibility based on RBV (Coleman et al., 2013). Even though some studies
depend on slack resource steps, management attention to leveraging these fungible assets is
not considered. Some acts allow hotels to manage the new competitive environment. These
actions contribute directly to achieving strategic flexibility and SCA. It calls for flexibility and
the ability to balance the organization’s stable and dynamic states. In the context of product
innovation and process improvement, strategic flexibility is examined, but empirical research
is less important in the context of hotels seeking flexibility to explore new SCA opportunities.
This literature review has revealed a lack of studies dealing with the relation between
strategic flexibility and SCA. In recent Majid et al. (2019) have postulated strategic flexibility
in defining strategic performance in the hospitality industry. Very limited studies have been
investigated in this relationship consideration. This literature attempt to address a unique
impact on the relationship between strategic flexibility and SCA.
H6. Strategic flexibility has a positive effect on SCA.

The research framework

Measurements
In this study design, the data were obtained and quantified by a quantitative design following the
deductive approach (Kumar et al., 2018). Data, opinions, motivations and attitudes of the
respondents provide an efficient survey design that measures the overall perceptions of hotel
employees. The survey was distributed into 45 five-star and luxury hotels in Malaysia.
Absorptive capacity was assessed using five items developed by Camison-Zornoza et al. (2009).
The items were indicated as knowledge-based competition, information assimilation and
transformation capacity, information application and exploitation capacity, scientific and
technologicalinformation,and externalsourcesofinformation.Team culture wasassessedusing
five items developed by Hu et al. (2009). The items were indicated as sharing knowledge and
information interactive manner, coordinate, excellent spirit, contributes equally to the hotel
creativity. CIA was assessed using five items developed by Pellissier and Nenzhelele (2013). The
items were indicated as aware, practices, appointed staff for information collection, dignified
competitive intelligence role. Entrepreneurial behavior was assessed using three items developed
byLiu (2013). The items were indicated as the strengths and tactics of the competitors, reactquickly
to threatening competitive action. Strategic flexibility was assessed using three items developed
by Zhou and Wu (2010). The items were indicated as strategy based on customer’s product and
service preference, strategies used in their uncertain or risky time based on change and technology,
detects new business threats and opportunities. Innovativeness was assessed using two items
developed by Zhou and Wu (2010). The items were indicated as new service/product and service
competitors of the market were new. SCA was assessed using four items developed by Hu et al.
(2009). The items were indicated as offers relatively low pricing as rivals, provides the consumer
with high product/service and the customer appetite for new features is smaller than the typical
business time to launch. The reflective measurement of the constructs within the survey
instrument were adapted from previous studies following seven-point Likert scale.
Data collection
The study followed the survey method to address the research objectives that offered
advantages to collect much data. We then carried out a pilot test to verify that the questionnaire
JHTI adapted and verify the accuracy. For the pilot study or pre-test, the constructs’ reliability and
validity have checked and surveyed 50 respondents to analyze. The pitot study was checked
whether the factors are manipulated correctly or not. We refined the questions to get to the final
questionnaire after the pilot test (Su et al., 2018). Then the following area of research with the
target population and the sample size was determined. The “rule of thumb” for calculating the
sample size is given by Tan et al. (2018) because the specimen size is reported to have been
higher than 30 and smaller than 500 for most studies. Nonetheless, some researchers propose a
data range of 10 times as much as the number of measurements item (i.e. this study all variables
items 27) reported by Hair et al. (2010). The survey was given to the hotel management staff,
such as CEOs, Managers and Supervisors. A total of 457 questionnaires were received and
found to be useful from a total of 550 surveys distributed earlier. In this study, CFA
(Confirmatory Factor Analysis) and SEM (Structural Equation Modelling) were analyzed by the
following statistical method (AMOS.24). For the bootstrapping procedures, we used 5,000
resample to assess the model’s mediation effect.

Respondent’s profile
Description statistics show that the staff, 57.5% of them men and 42.5% of the women have
responded. The age range was 22.7% of workers below the age of (20–27), while the age group
was 39.6% (36–60) and the age group was 37.6% (28–35). The degree of personnel education
reported that 33.9% of diploma holders were 16.6% of graduate and 29.8% for credential
holders and just 1.5% for postgraduate students. For the divisions of hotels, 26.3% came from
front office, 33% came from food and beverage, 14.9% from housekeeping and 4.4% from
HRM. Data from staffs have also been gathered, as replied to GM by 2.7%, 57.9% and
supervisors by 39.4%. Finally, work has found that 6-9-year-olds are 29.8% over 15 years old,
09% (see Table 1).

Results and interpretations

Measurement model
This study carried out the normality test by integrating distances Mahalanobis D2 with
skewness and kurtosis. However, for the individual variable, the absolute value of
skewness falls within the range 1 or 1 and Kurtosis 3. Therefore, the pattern is reasonably
suitable, and the dataset is normally distributed. This study follows Eichhorn (2014)
common methods variance procedures to mitigate possible bias by following procedural
remedies of questionnaire design between all constructs. This study has removed all
psychological separation (question headings) from the questionnaire. The reflective
measurement model evaluation shows that the Alpha (α) Cronbach criteria were applied to
test build reliability. The evaluation shows CR (0.7) and AVE (0.5), and this analysis
obtained all values. Table 2 displays (α) values above the proposed 0.7 for each building,
suggesting an acceptable degree of reliability (Rasoolimanesh et al., 2019). The average
extracted variance value (AVE) is (0.5) and all constructs are confirmed with acceptable
values (See Table 2). The validity assessment indicates that the discriminant validity was
assessed through a Fornell-Larcker criterion to differentiate the constructs (Henseler et al.,
2015). Following this, discriminant validity was examined (Voorhees et al., 2016), the square
root of the AVE of each construct should be higher than the correlation with all other
constructs (see Table 3).

Structural model
The structural model is present within the corresponding spectrum of a broad chi-square
(X2 5 701.367, df 5 473, p < 0.000) and (X2/df 5 1.549) (see Figure 1). Further fitness
Demographic constructs Measurement items Frequency Percentage (%)
Determinants
of SCA from
Gender Male 263 57.5 resource-based
Female 194 42.5
Ages (20–27) 104 22.8 view
(28–35) 172 37.6
(36–60) 181 39.6
Education Secondary/SPM 83 18.2
Certificate 136 29.8
Diploma 155 33.9
Undergraduate 76 16.6
Postgraduate 7 1.5
Hotel departments Front office 120 26.3
Food and beverage 151 33.0
Housekeeping 95 20.8
Sales and marketing 68 14.9
HRM 20 4.4
Others 3 0.7
Job position General manager 12 2.7
Departmental manager 265 57.9
Supervisor 180 39.4
Working years in the hotel Under 3 years 54 11.8
3–6 years 123 26.9
6–9 years 136 29.8
9–12 years 126 27.6 Table 1.
12–15 years 14 3.1 Demographic profile of
Above 15 years 4 0.9 the respondents

measures, such as CFI (0.947), IFI (0.946), GFI (0.934) and RMSEA (0.044), also shown the
acceptable (Hair et al., 2010). Table 4 highlights the results of the hypothesized relationship
between constructs, and Figure 2 reflects the total impact of the exogenous variable on
endogenous variables, direct effects and indirect effects. Among the total five direct
hypotheses, four are statistically supported, and one is not supported (see Table 4). The
influencing factors of strategic flexibility indicates three hypotheses significantly (H1a, H2a
and H3a) with (β 5 0.261, t 5 2.147, p < 0.05), (β 5 0.214, t 5 2.106, p < 0.05) and (β 5 0.113,
t 5 1.195, p < 0.05). Besides, entrepreneurial behavior has a negative and insignificant effect
on strategic flexibility (H4a) with (β 5 0.072, t 5 0.938, p > 0.01). Also, the strategic
flexibility significantly impacts SCA (H5) with (β 5 0.271, t 5 3.246, p < 0.01).
Influencing factors on strategic flexibility explain 22% of the variance and strategic
flexibility explains 19% of the variance in SCA, and the R2 results are acceptable (Cohen,
1988). To assess the mediations, the path coefficients approach was applied to test the
significance of indirect effects (H1b), (H2b), and (H3b). The findings indicate that indirect
effects on H1b, H2b and H3b have also been relevant (β 5 0.070, p < 0.05), (β 5 0.069, p < 0.05)
and (β 5 0.089, p < 0.05), where the confidence interval (bias-corrected) does not straddle zero
between: [LL 5 0.007, UL 5 0.114], [LL 5 0.278, UL 5 0.059] and [LL 5 0.007, UL 5 0.114]
and identified the significant mediations. The findings also have shown below (Table 4) that
entrepreneurial behavior insignificantly effects SCA through strategic flexibility with
(β 5 0.008, p > 0.05). A test finding from H6 also verified the moderating position of
innovativeness as regards the relationship between strategic stability and SCA. There is a
substantial interaction expression (strategic stability x innovation) (β 5 0.126, p < 0.001).
Figure 3 also mentioned this impact when innovativeness was high relative to low slopes. The
findings revealed that the links from strategic flexibility (β 5 0.234, t 5 8.576), innovativeness
(β 5 0.313, t 5 5.497) to SCA was significant H6. This study tests the moderating of
JHTI Cronbach’s Composite Average variance
Constructs Items Loadings alpha (α) reliability (CR) extracted (AVE)

Absorptive capacity AC1 0.66 0.815 0.831 0.581

AC2 0.72
AC3 0.67
AC4 0.86
AC5 0.60
Team culture TC1 0.75 0.894 0.890 0.633
TC2 0.76
TC3 0.81
TC4 0.88
TC5 0.77
Competitive intelligence CIA1 0.79 0.869 0.870 0.573
awareness CIA2 0.72
CIA3 0.74
CIA4 0.79
CIA5 0.75
Entrepreneurial EB1 0.64 0.786 0.702 0.500
behavior EB2 0.82
EB3 0.77
Strategic flexibility SF1 0.73 0.806 0.806 0.581
SF2 0.77
SF3 0.79
Innovativeness IN1 0.78 0.798 0.799 0.665
IN2 0.85
Sustainable competitive SCA1 0.77 0.844 0.917 0.734
advantage SCA2 0.67
Table 2. SCA3 0.89
Confirmatory factor SCA4 0.90
assessments and Note(s): Goodness-of-Fit Indices: X2/DF 5 1.549, p-value 5< 0.05, NFI 5 0.857, IFI 5 0.948, GFI 5 0.873,
loadings CFI 5 0.947, RMSEA 5 0.044

Constructs MSV MaxR(H) 1 2 3 4 5 6 7

Strategic flexibility 0.118 0.806 0.762

Innovativeness 0.025 0.799 0.153 0.815
Entrepreneurial 0.059 0.819 –0.078 0.157 0.758
behavior
Absorptive capacity 0.057 0.859 –0.232 0.011 –0.200 0.707
Table 3.
CIA 0.064 0.872 –0.010 0.085 0.135 –0.014 0.757
Maximum shared
variance and Team culture 0.116 0.903 0.341 0.016 0.143 0.171 0.253 0.795
maximum reliability SCA 0.118 0.926 0.343 0.079 –0.036 –0.238 0.060 0.201 0.858
and constructs Note(s): Diagonals represent the square root of the average variance extracted while the other entries
correlation represent the correlations

innovativeness between strategic flexibility and SCA’s relationship to the mechanism behind
this relationship.

Discussion and conclusion

The SCA investigation creates an organization foundation for advancing knowledge and
facilitating theory development and uncover areas where research is needed (de Paiva Costa
 Determinants
Absorptive
Innovativeness of SCA from
Capacity resource-based
H1a view
H6

Team Culture
H2a Strategic
Sustainable
Competitive
Flexibility
H5 Advantage
Competitive H3a
Intelligence
Awareness
H4a

H1b H2b H3b H4b Figure 1.

Entrepreneurial The research
Behaviour framework

Direct effects
Hypothesis DV IV β S.E C.R p-value Decision

H1a SF ← AC 0.261 0.122 2.147 0.001 Yes

H2a SF ← TC 0.241 0.077 2.106 0.007 Yes
H3a SF ← CIA 0.113 0.067 1.195 0.007 Yes
H4a SF ← EB 0.072 0.077 0.938 0.298 No
H5 SCA ← SF 0.271 0.084 3.246 0.001 Yes

Indirect effects
Hypothesis Relationship β p-value 95% confidence interval Decision

H1b AC → SF → SCA 0.070 0.001 ( 0.181) – ( 0.015) Yes

H2b TC → SF → SCA 0.069 0.009 ( 0.153) – ( 0.017) Yes Table 4.
H3b CIA → SF → SCA 0.039 0.012 ( 0.014) – (0.108) Yes Structural path
H4b EB → SF → SCA 0.008 0.440 ( 0.094) – (0.018) No analysis results

5
4.5
4
3.5
SCA

Low
3 Innovativeness
2.5 High
Innovativeness
2
Figure 2.
1.5 The moderating
impact of
1 innovativeness
Low SF High SF
JHTI
Innovativeness
B = 0.070, p = <0.05
Absorptive
Capacity B
=

B = –0126, t = 0.000
0.
26
1,
t=
B= 2.
B = 0.069, p = <0.05 0.21 14
4, t 7
Team Culture =2
.106
R2 = 0.19
R2 = 0.22
Sustainable
95 Strategic
,t = 1.1 Competitive
.113 Flexibility B = 0.271, t = 3.246
B = 0.039, p = <0.05 B=0 8
Advantage
Competitive 3
Intelligence – 0 .9
t=
Awareness 7 2,
–0.0
=
B

B = –0.008, p = >0.05 Entrepreneurial-

Figure 3. Behaviour
Structural model
assessment results

and Pereira, 2019). Valuable and uncommon authoritative resources can be wellsprings of SCA,
and underlying assets being defectively imitable (Anning-Dorson and Nyamekye, 2020). This
present study has shown that all the hypotheses are supported and significant based on the
coefficient (β), t-value and p-value.
The above findings have revealed that absorptive capacity significantly impacts strategic
flexibility and explains knowledge acquisition and assimilation. At the same time, knowledge
acquisition and assimilation are the essential skill-based resources in the organization. These
two kinds of knowledge also indicate that new external knowledge is required to be absorbed
in the hotel (Jansen et al., 2005). Besides, Javalgi et al. (2005) have incorporated the mediating
role of strategic flexibility between service design and market performance. External
knowledge is essential for overall hotel development; in this sense, hotels apply their
knowledge to predict SCA by using strategic decisions. It can be expected that knowledge
transformation and application play an important role in strategic systems.
Further, the above findings exposed that team culture positive and significantly impacts on
SCA. Based on this relationship’s coefficient value, team culture’s excellent practice can
enhance flexibility in the hotel’s strategies during risks occur. According to Delmas and
Pekovic (2018), organizational strategies and decision-making play the role of team culture in
the competitive market. It also significantly impact on SCA through strategic flexibility, which
revealed on the above findings. Ndlela and Du Toit (2001) have investigated that sharing
knowledge with the hotel’s team members enhance SCA. Besides, the findings have shown that
the CIA positive and significant effect on strategic flexibility. According to Bose (2008), it
creates and maintains in the organization related web mining and technological-based.
Drawing the RBV, the CIA indicates the pre-attention based on the hotels’ resources to predict
SCA. Besides, the results also have shown that it affects SCA through strategic flexibility,
emphasizing decision-making to achieve SCA. The above results have shown that
entrepreneurial behavior insignificantly affects strategic flexibility. Also, the above results
showed it indirectly impact on SCA through strategic flexibility in an insignificant manner.
According to Thomas (2014), strategic flexibility mediates between product design and
performance. This outcome may be explained as the reason for the contextual unpredictability
of insignificant findings.
 Furthermore, the results showed that innovativeness significantly strengthens between Determinants
strategic flexibility and SCA. Innovativeness in the correlation between customer behavior of SCA from
and results has been moderated according to Liu (2013). Moreover, the moderating impact of
innovativeness between consumer behavior and results was analyzed using RBV Brockman
resource-based
et al. (2012). Likewise, essential to use RBV, the findings have shown that strategic flexibility view
significantly impacts SCA. This finding clarifies the importance of hotels’ strategic flexibility
overcoming the uncertain risk of inappropriate attention (Nadkarni and Narayanan, 2007).
Concerns about strategic versatility have led hotels to pursue various types of creative
activities to meet the current competitive requirements in their rivals or build numerous, if
temporary, advantageous bases. By investigating SCA and the role play in it, this study
model is the first to focus on Malaysian hotels’ context.

Theoretical implications
A further aim was to carry out a theoretical implication and thereby give practitioners
assistance. As the hotel sector has evolved in the past decade, after becoming a stable, managed
and growing market, SCA can be best described by hotel managers. The study addressed
several issues that affect SCA variables, taking into account the common pattern in the hotel
sector in Malaysia. Although the findings of the analysis are not broad and straightforward
enough to propose a regulatory model for RBV-based SCA, it stresses the need to take many
factors into account overall. There are an imposing variety of theoretical rationales to endure
the perspective that hotel settings provide a more fruitful venue for SCA. The possible
outcomes indicate that the above findings suggested that the impact of absorptive capacity,
team culture and CIA positively impact SCA. The outcomes indicate that absorptive capacity
(new external knowledge acquisition and assimilation) able to improve hotel strategic
flexibility, in terms of getting action in a flexible taking decision. According to Chesbrough and
Crowther (2006), the use that hotels make of external knowledge in the operation/production
process indicates inbound open creativity. But this external knowledge does not percolate
smoothly through the boundaries of the hotels that will not direct indulge to take decision for
uncertain risks. It indicates that the above finding suggested, absorptive capacity also increase
organizational SCA following mediating role of strategic flexibility. Chang et al. (2012)
suggested that absorptive capacity with knowledge transfer effects performance.
The above findings have suggested that team culture can increase strategic flexibility by
sharing and distributing knowledge among hotel management staff. Team culture is a special
case that occurs when two or more member work interdependently for a limited time to perform
a common and valued function. Vanpoucke et al. (2014) have investigated when a firm
implements a unique value-creating strategy which any current or potential competitors do not
implement simultaneously and when these other firms are unable to duplicate the benefits of
this strategy. According to Costa et al. (2014), the teamwork can enhance organizational
performance in a strategic environment. Besides, the CIA indicates competitive information
and data gathering for using future strategies. While competitive intelligence is a relatively new
management tool, it is evolving in complexity and importance to maintain pace with rapid
business development (Nenzhelele and Pellissier, 2014). The above findings have suggested
that the independent role of CIA required to increase the impacts of SCA. According to Wright
(2011) has drawn attention to the requirement for a hotel, to be more aware of how it manages
the critical information and knowledge around the many networks within a hotel.
The entrepreneurial behavior has shown that the irrelevant findings that may fail to
enhance strategic flexibility. While it required to analyze and observe behavior as an owner
or responsible personality. The findings have suggested that entrepreneurial behavior failed
to predict SCA through strategic flexibility. The entrepreneurial behavior in hotel operational
process, the activities of individuals engaged that occur in a period. It recognizes that most of
JHTI the entrepreneurial activity requires a set of actions or series of actions. The hotel needs to
focus on entrepreneurial behavior with some probable reasons (i.e. irresponsible behavior).
The hotel should concern these findings of each construct’s outcomes in their theoretical
implementation. The moderating role of innovativeness is required to enhance as it has a high
impact between strategic flexibility and SCA. According to Wright (2011), attention is to be
drawn to a hotel’s requirement to be more aware of their innovativeness.
Finally, the above findings theoretically suggest that strategic flexibility significantly
enhance SCA. According to Combe et al. (2012), the ability allows hotels to respond to
environmental change and also enables them to lead change when operating in current fast
moving hypercompetitive markets. While few empirical studies have investigated the
consequences of strategic flexibility, a positive relationship between strategic flexibility and
competitive advantage is indicated when hotels are involved in fast moving industries or
must respond to environmental changes. It is suggested that strategic flexibility of hotel is
more predictable in the competitive market to SCA.

Managerial implications
Furthermore, practical implication indicated that the hypotheses for future consequences are
applied in reality. The results are critical to the adoption of SCA by the hotel industry. The
hotel manager should concern or pay priority to the value of absorptive capability in the
distribution of services and current external application of information. The results above
indicate that hotel managers should concern themselves with team culture that influences
strategic flexibility. Team culture not only denotes group work in the hotels for the
production of facilities and goods, but also focuses on strategic decision-making.
Besides, the results of this present study also suggest that CIA indicates the hotel need to
be aware in their competition to get advantage in the competitive market. It is prescribed to
hotel managers that CIA results in regularity of sustaining in the market.
Hotel managers need to step up the CIA to put the results on the market where they are
relevant and optimistic. The results also indicate to hotel managers that the hotel’s management
decisions could improve entrepreneurial activity among top employees. Entrepreneurial
behavior points out that the conscientious behavior of the top staff will lead to organizational
instability or risk. Besides, hotels also should be careful on entrepreneurial behavior to predict
SCA through strategic flexibility. Moreover, the findings have suggested that hotel managers
need to stand for improving strategic flexibility that enlighten SCA. Strategic flexibility to
evaluate the effectiveness of hotel that enhance the developing perception of the hotel manager
to take decision in critical manner or uncertain situation.
Hotel managers should concern the outcomes to improve hotel SCA. Hotel managers are
advocated to take necessary action to follow on these findings and implement it to improve
the hotel’s SCA. Hotels should incorporate strategic flexibility in their standard operating
procedures as competitive advantage requirements in a sustainable fashion with
innovativeness. It is likely an essential element for the hotel to improve and develop further
action plans. The hotel should concern the insignificant results of entrepreneurial behavior,
which may unconfidently practice in the hotels. Few studies examine the impact of influencing
factors on SCA to the best of authors’ understanding (Combe et al., 2012). Therefore, this can be a
unique theoretical contribution to the current study. Besides, examining these direct and
indirect effects on SCA has been carried out in Malaysian hotels, which can be considered
another contribution of the current study.
To follow the way of findings implementation, hotels should begin with management to
become conscious of this finding in a new phase. This study indicates. Training on these
observations surrounding signs can be arranged by the hotel manager. Managers have often
taken measures or met to forecast SCA according to the technique. The findings show that the
hotel manager should introduce the concept of reducing the hotel facilities’ lack and Determinants
inefficiency and succeeding in future business. of SCA from
resource-based
Limitation and future research view
Firstly, the researcher highly foster to validate further and extend the current model. Other
factors in determining SCA used in the previous literature also addressed limitations, where
this study determined only a few factors in the hotel industry.
The analysis takes action to minimize the risk of unethical practice as far as ethical issues
are concerned. Any form of bias for data collection practice and/or responses to respondents.
No respondent was obligated to participate; all respondents were able to respond by reading
to a questionnaire and informed consent form. Since this study was restricted to the hotel
industries in Malaya, it would be worth replicating the analysis in order to assess their SCA
levels with other companies working in the same environment. Overall, all the relationships
and objectives finally suggest using theories to implement these outcomes for future
enhancement and success. Thus, future research should also address how SCA adapts to and
even shape the hotel’s organizational settings.

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Corresponding author
Kashif Hussain can be contacted at: kashif.hussain@msn.com

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